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While the COVID-19 crisis has dramatically changed all of our lives, around the world we’ve seen transit agencies, transport authorities and operators step up and do their bit to confront this unprecedented challenge, maintaining crucial services for key workers and taking the necessary steps to protect drivers and passengers.
We couldn’t be prouder to be part of this industry, and to have played our small part working alongside our partners and agencies around the world. As we look to 2021, with breakthroughs such as vaccines hopefully signalling a turning of the corner on Covid, we wanted to reflect on the developments agencies have made during 2020 and the trends we are seeing as they focus on plans to safely bring riders back during 2021.
We hope this is helpful and, as ever, please do let us know your thoughts. Prior warning, this blog is LONG(!), and we know not everyone will have the time to read it. So if you want a summary of the trends you can skip to “2021 and the road to recovery” for a high level overview.
For us, four themes have stood out from last year and as we move into 2021, these are;
- Agencies are prioritizing ‘safe ways to pay’
- Bringing riders back: Why agencies are moving to Account-Based Ticketing (ABT)
- Partner ecosystems really matter: Cash Digitization and Mobility-as-a-Service
- Revenue and cost pressures: Doing more with less via Fare Payments-as-a-Service (and we all need to help #SavePublicTransit
- Conclusion: 2021 and the road to recovery
Not in the mood to read? Listen to the audio blog instead.
Safe Ways to Pay
This should come as no surprise, but one of the main ways agencies have helped make public transit safe for riders has been by providing 'safe ways to pay' with the main solution being mobile ticketing. The main reasons for this, is that mobile ticketing can be deployed quickly (our record is 16 days), allowing riders to purchase tickets anytime, anywhere - helping to keep both riders and drivers safe. Mobile ticketing systems do not need hardware (at least not on launch) to be installed and because most suppliers offer their systems 'as a service' it has no, or low, up front costs and usage based pricing. The demand for 'safe ways to pay' will certainly continue during 2021 and for those with mobile ticketing in place we will see contactless ticketing expand to cover a significant proportion of riders to ensure whoever needs travel has a convenient and safe experience.
(2020 Highlights: Masabi supported mobile ticketing launches for Montreal, St Louis, Calgary, Santa Cruz and Valencia, the development of regional multi-agency projects, and the expansion of Practical Mobility-as-a-Service with ticketing integrated into leading mobility apps.
- Europe and Japan: Bucharest STB, Romania – with partners Mastercard and UniCredit, Uber Boat by Thames Clippers, London, EMT Valencia, Spain – with Mastercard, Iyotetsu, Japan - with partner Jorudan, Okayama Prefecture, Japan - with partner Jorudan, Kagoshima and Hachijo-jima, Japan - with partner Jorudan
- Canada: Calgary Transit, ARTM in Montreal – with partner Transit
- USA: Santa Cruz Metro, SJCOG EZHub - Seven Transit Agencies in California’s Central Valley, St. Louis Metro - with partner Transit, EZFare tickets available in Uber, for 13 agencies across three states, Dayton RTA – with partner Transit, EZFare tickets available in Moovit, for 13 agencies across three states, Ann Arbor - TheRide, Collier Area Transit, Las Vegas’ RTC Transit tickets launched in Uber, Denver RTD tickets launched in Lyft, Las Vegas’ RTC Transit tickets launched in Transit)
Bringing riders back: Why agencies are moving to Account-Based Ticketing (ABT)
In 2020 we have seen the trend towards Account-Based Ticketing accelerate, and we think this will continue in 2021 as agencies focus on bringing ridership back to pre-COVID levels.
But why, you may be asking, would Account-Based Ticketing help with encouraging riders to return to public transit?
With Account-Based Ticketing, passengers simply jump on a mode of transport by tapping a secure ‘token’ on a validation device. The ‘token’ is typically a contactless bank card, mobile phone or smartcard, depending on how the system is configured, with the right to travel and fare calculations done in the back office. This is key!
- Convenience. ABT provides the ultimate convenient ticketing experience for riders by eliminating the need for passengers to buy a ticket before traveling or understand which fare they need to choose.
- Rewarding Transit Usage. ABT enables every rider to benefit from period passes, even when they can’t afford to purchase them up front. Instead, they simply tap and ride when they need to travel and the back office ‘caps’ their fare - the more they travel the more they save, rewarding them the more they ride.
- Fare Flexibility. ABT gives agencies the ability to implement new fares extremely quickly, which is particularly useful as agencies look to attract riders back. With flexible working affecting travel habits, new more flexible fares to reflect this can be pushed live quickly controlled and calculated in the back office.
(2020 Highlights: Rochester RTS (NY) launched a landmark Account-Based Ticketing solution for their riders in July 2020 and the first in the world to be powered by a MaaS-Enabled Fare Payments-as-a-Service Platform. For riders, this means they no longer need to buy a ticket or understand fares before traveling. They are now able to use their new RTS Go smart card or RTS Go mobile pass, which is integrated into the Transit app, to simply tap and ride. Riders are then charged the best possible price for their journey. For the industry, it marks the beginning of the end for traditional fare collection as we know it, with full fare payment systems delivering agencies of all sizes the latest ‘Fare Payment’ innovations ‘as a Service’, quickly and for a fraction of the cost of bespoke systems. Saskatoon will also be launching their own mobile and Account-Based Ticketing system next year and we know many other agencies are following their lead.
We have also seen increased demand for electronic validation to help keep drivers (operators) safe. For ABT systems to work validation is key. Justride Validators (JRVs) were designed from the ground up by our team to meet the demands of Account-Based Ticketing at a price point that for the first time makes it affordable for all. In 2020, JRVs have been deployed in Rochester, Dayton, with Lurraldebus in Spain and for Laketran (US), with lots more agencies launching in 2021.)
Partner ecosystems really matter: Cash Digitization and Mobility-as-a-Service
Transit is fundamentally a team game, with a whole ecosystem of companies and stakeholders working together to make sure the trains or buses run on time and fare payment is no different.
Last year placed tremendous focus on the importance of public transit being available for everyone, and we are delighted to have rolled out cash digitization services in two US cities, Dayton and Las Vegas, with partners T-CETRA and InComm. It is really crucial for agencies to ensure the unbanked are able to access the same services as other riders, and we expect this trend to continue.We also launched a new cash digitization service in the UK with Payzone for National Express Bus.
Riders across these three agencies can now use local retailers to top up their mobile ticketing app with tickets and stored value using cash. This means that access to a contactless mobile ticketing service is no longer limited only to those with debit or credit cards. It ’s really important for agencies to ensure the unbanked are able to access the same services as other riders, and we expect this to continue.
Attracting riders back is going to be crucial in 2021 and last year saw an acceleration in agencies focusing on Practical Mobility-as-a-Service (MaaS). Using the Justride SDK our mobility partners are able to incorporate mobile ticketing into their existing applications and help enable a MaaS experience for riders quickly and cost-effectively. In fact, 47 agencies are now enabling a Practical Mobility-as-a-Service approach.
(2020 Highlights: We have mentioned a number of these earlier in the blog, but here are some of the MaaS deployments from 2020 with our existing partners: ARTM Montreal with partner Transit, Uber Boat by Thames Clippers, Kagoshima and Hachijo-jima with partner Jorudan, SJCOG EZHub - Seven Transit Agencies in California’s Central Valley with partner Kyyti, St. Louis Metro with partner Transit, EZFare tickets available in Uber, for 13 agencies across three states, Dayton RTA with partner Transit, Las Vegas’ RTC Transit tickets launched in Uber, Las Vegas’ RTC Transit tickets launched in Transit.
2020 saw us announce new partnerships, strengthen existing relationships and work closely with regional transit players, industry innovators and leading global brands that make up our partner network. New partnership this year included; Trapeze – Announced partnership with Trapeze, Kyyti – Announced partnership with Kyyti, LittlePay – Masabi and Littlepay Unveil ‘Contactless EMV in a Box’ Transport Ticketing Solution, Moovit - EZFare tickets for 13 agencies across three states, Lyft - Launched with Denver RTD.)
Revenue and cost pressures: Doing more with less via Fare Payments-as-a-Service
This year has been really hard, not least because fare revenue has dramatically reduced and in many cases agencies and operators have needed government support to keep providing crucial services for key workers.
In 2020 we have seen a record number of agencies move away from the old way of delivering fare payment solutions, where each agency purchases and operates their own bespoke systems. These systems are expensive to build, operate and maintain, and cumbersome to deploy and update (if updates happen at all!).
Instead, agencies have been opting for a Fare Payments-as-a-Service (FPaaS) approach, where multiple agencies sign up and use the same platform which is configured to meet their needs. This removes the cost, risk and complexity of providing the latest fare payment innovations as the costs are shared and the system is live with a roadmap of functionality provided for everyone using the platform.
33 agencies opted to have services delivered using Masabi's multi-tenant fare payments platform in 2020. We believe we will see a further significant shift to this better way of providing fare payment systems in 2021, because of the cost-savings and the ability to enable constant innovation.
We joined forces with our APTA partners and the entire US public transportation industry in December to collectively fight to #SavePublicTransit with a day of mobilization and engagement.
The transit industry is facing a dire financial crisis, not only in the US but around the globe, and emergency funding has never been more urgent.
So we are calling on Congress and the Administration to provide at least $32 billion in emergency funding to ensure that public transit agencies can survive, helping communities and the nation by transporting essential workers to their jobs and speeding the recovery from the economic fallout of the pandemic.
This issue is not going away as we move into 2021 and we will continue doing what we can to support campaigns around the globe ensuring crucial public transit services are kept going. Public transit will be critical in driving recovery!
2021 and the road to recovery
Most agencies we speak to envisage a full return of ridership numbers in 2022, with a ramp up in 2021 starting in the spring. However, remote working may mean commuters stay away longer, and there may be an overall reduction in commuting as people work more flexibly.
Now there is a light at the end of the tunnel, agencies are beginning to move from ensuring services are COVID-safe, to ask how they attract riders back to public transit by offering a convenient experience, new flexible fares and safe ways to pay and travel. However, costs and funding are a big concern with agencies potentially needing to reduce costs and explore new revenue generation options, as well as needing more government support.
From a fare payments point of view, the need to reduce costs while at the same time enabling contactless ways to pay, convenience, MaaS and new flexible fares to bring riders back will see more agencies speed up transitions to a Fare Payments-as-a-Service delivery model in order to deploy Account-Based Ticketing using mobile phones, contactless bank cards and smartcards. This, together with the delivery of cash-digitization with local retailers, will help ensure all riders can make use of these contactless services and benefit from MaaS rider experiences, helping agencies recover ridership.
We hope these insights are useful. If we have missed anything, or you disagree with any of these trends, please do let us know at James.Gooch@masabi.com.